In all, nearly 100,000 people arrived in Britain seeking asylum, 20,000 more than Germany. The Government's statistics exclude dependents. Shelter said claims that refugees were being given the best housing were a myth. Nineteen per cent of the houses inspected had cockroaches, fleas or bedbugs. Four in five of the properties were major fire risks and 28 per cent were overcrowded.

Chris Holmes, director of Shelter, said: "The system is allowing hundreds of unscrupulous landlords to cash in on some of the poorest and most vulnerable people who have no other options and almost no housing righ. Our findings explode the myth that asylum seekers are fast-tracking into the best housing. Many are living in squalor that puts their health and safety at risk."

Shelter alleged that children were being put at risk in some cases. In one south London borough, 16- and 17-year-old asylum seekers were placed in a hotel with homeless men. In another case, six refugees, all under 18, were the sole occupants of a converted factory.

The Home Office said Shelter's report was based on research completed last April before new initiatives had started to take effect. Since then, the National Asylum Support Service had eased pressure on the hardest-pressed local authorities.